"Not Losing to Apple and China" Samsung Holds Firm on Foldables... Lowering Price to Expand Market Share

[Asia Economy Reporter Joeslgina] "Lowering the price by 400,000 won." Samsung Electronics, the leader in the foldable smartphone market, is making a bold move to popularize foldables by significantly lowering the price threshold of its new products ‘Galaxy Z Fold3’ and ‘Z Flip3,’ which will be unveiled next month. This is a move to solidify market dominance ahead of the foldable new product battle that will intensify in the second half of this year.

This move is interpreted as a response to the blatant ‘copycat + low-price’ offensive by Chinese manufacturers, as well as a step to prepare for Apple’s future entry into the foldable market. Chinese companies such as Huawei, Xiaomi, as well as Oppo, Vivo, Google, and Microsoft (MS) are also expected to launch foldable phones one after another soon.

◆ "Won't lose market dominance" Samsung lowers foldable prices

According to industry sources on the 15th, Samsung Electronics will hold a ‘Galaxy Unpacked’ event around the 11th of next month to unveil the new foldable phones Galaxy Z Fold3 and Galaxy Z Flip3. The retail price of the Galaxy Z Fold3, currently under discussion between Samsung Electronics and mobile carriers, is about 400,000 won cheaper than its predecessor, at around 1.99 million won. This would make the Z Fold3 the first Z Fold series priced under 2 million won. The clamshell design Galaxy Z Flip3 is also being discussed at around 1.25 million won, 400,000 won lower than the previous model (1.65 million won).

The reason Samsung Electronics has significantly lowered the high price, which has been considered a barrier to entry for foldable phones, is to expand the foldable market. If the currently discussed price range is finalized, the new foldable phone’s price could be lower than some models of the upcoming Apple iPhone 13. This price range now allows competition not only among foldable phones but also with strategic flagship smartphones.

This also reveals Samsung Electronics’ intention to preempt the market in the future form factor competition with Apple, which has yet to release a foldable phone. It reflects the company’s determination not to repeat the humiliation of losing market dominance to Apple’s iPhone 12, which was released much later despite Samsung launching 5G smartphones first.

Researcher Im Sujeong from Counterpoint Research evaluated, "Currently, Samsung Electronics is the most advanced in the technical aspects of foldable phones and holds a very advantageous position compared to other companies in securing the supply of the core component, the foldable display panel." Samsung can also target the gap left by LG Electronics, which announced the launch of a rollable phone but withdrew from the smartphone business.

The price reduction strategy was announced early on. It is difficult to grow a new form factor market in the saturated global smartphone market with prices in the 2 million won range. According to market research firm Counterpoint Research, the global foldable phone market is expected to grow threefold from 5.6 million units this year to 17.2 million units next year. With Samsung Electronics already holding about 80% market share, it needs to accelerate market growth through foldable popularization.

◆ Xiaomi, Vivo... Foldables flood the market

The foldable offensive by Chinese manufacturers, who are chasing with low prices, is also intensifying. Xiaomi and Vivo are planning to launch new foldable phones in the second half of the year. In particular, these Chinese manufacturers appear to be trying to take Samsung Electronics’ market share by flooding the market with models that closely resemble the Galaxy Z Fold and Z Flip.

Xiaomi released the ‘Mi Mix Fold’ earlier this year, which closely resembles the Galaxy Z Fold2, and plans to unveil a new product similar to the Galaxy Z Flip by the end of this year. According to recent renderings based on two Xiaomi patents reviewed by IT media LetsGoDigital, the display size and clamshell design are almost identical to the Z Flip. Huawei is also expected to continue this copycat strategy. After receiving criticism that its foldable phone Mate X2 resembled the Galaxy Z Fold2 earlier this year, Huawei publicly compared the two products and claimed its product was superior.

Next-generation foldable phone from Xiaomi closely resembling the Galaxy Z Flip series rendering [Source: LetsGoDigital]

Vivo will also launch its first foldable phone, the ‘NEX Fold,’ in the second half of the year. IT tipster Ice Universe recently predicted, "Instead of releasing the Vivo NEX5 this year, the NEX Fold will be launched." Oppo is also expected to unveil a foldable phone with a 7.1-inch display when unfolded and 5.45-inch when folded as early as this year. Additionally, Google’s Pixel Fold and Microsoft’s next-generation dual-screen foldable phone ‘Surface Duo 2’ are also preparing to launch soon.

An industry insider said, "If Apple joins the form factor war around 2023, the related market growth will be even more explosive," adding, "For Samsung Electronics, it is inevitable to adopt a two-track strategy of lowering prices to counter the low-price offensive from Chinese manufacturers and advancing with innovation in new products."

This content was produced with the assistance of AI translation services.